Parl committee: Create 'non-lapsing' fund for military modernisation

Ajay Banerjee

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New Delhi, December 29

In an important suggestion, the Parliamentary Standing Committee on Defence has again said that a “non-lapsing” fund for military modernisation must be created so that the midyear need for budgetary allocation and additional grants is avoided.

The committee led by BJP MP Jual Oram presented its “six-month statement regarding status of implementation of recommendations” in Parliament during the winter session that ended on December 23.

It said that at present, there was no separate allocation of funds for committed liabilities and new schemes, as such funds were allocated under the capital acquisition (modernisation) head.

The committee said it had recommended to the Ministry of Defence to create a dedicated fund for committed liabilities and new schemes. “As there has been no progress in this regard, the committee again urges the ministry to create a separate head (fund) from the next Budget.”

The committee, in its previous report, had recommended making capital budget “non-lapsable” and “roll-on” in nature.

Under the existing rules of business of the government, funds allotted in the Budget lapse at the end of each financial year on March 31.

The committee, in its report said, it was apprised during the oral evidence that a draft Cabinet note for “Non-Lapsable Defence Modernisation Fund” was under consideration.

The committee asked the ministry to expedite the constitution of such a fund meant exclusively for the procurement of critical defence assets at critical times. “Approval may be accorded (to the draft Cabinet note) to fructify its creation at the earliest so that procurement can be unhampered,” the committee advised the ministry.